In the use of modern portfolio theory (MPT), the sum of the credit risks of loans under estimates the risk of the whole portfolio.
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Q11: In the past, data availability limited the
Q12: A loan migration matrix is a measure
Q13: The concentration limit method of managing credit
Q14: Modern portfolio theory models consider only how
Q15: Using migration analysis, a loan officer tracks
Q17: The simple model of migration analysis tracks
Q18: A disadvantage to modern portfolio theory (MPT)
Q19: Concentration limits are used to either reduce
Q20: One advantage of portfolio diversification methods is
Q21: If a bank's concentration limit (as a
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